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{"id":36779,"date":"2023-07-09T22:16:29","date_gmt":"2023-07-09T22:16:29","guid":{"rendered":"https:\/\/scienceandnerds.com\/2023\/07\/09\/eus-competition-unit-takes-a-deeper-look-at-amazons-irobot-acquisition\/"},"modified":"2023-07-09T22:16:30","modified_gmt":"2023-07-09T22:16:30","slug":"eus-competition-unit-takes-a-deeper-look-at-amazons-irobot-acquisition","status":"publish","type":"post","link":"https:\/\/scienceandnerds.com\/2023\/07\/09\/eus-competition-unit-takes-a-deeper-look-at-amazons-irobot-acquisition\/","title":{"rendered":"EU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition"},"content":{"rendered":"

Source:https:\/\/techcrunch.com\/2023\/07\/07\/amazon-irobot-eu-antitrust-probe\/<\/a><\/br>
\nEU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition<\/br>
\n2023-07-09 22:16:29<\/br><\/p>\n

\n

Amazon\u2019s planned acquisition of iRobot is now under in-depth antitrust scrutiny in the European Union.<\/p>\n

The $1.7 billion deal for the ecommerce behemoth to pick up the robot vacuum maker, announced just under a year ago<\/a>, was cleared by competition regulators in the U.K. last month<\/a>. But EU regulators are now stepping in for their own close sweep.<\/p>\n

In a press release<\/a> put out yesterday evening, the Commission said it\u2019s concerned the transaction would allow Amazon to restrict competition in the market for robot vacuum cleaners (RVCs) and strengthen its position as online marketplace provider in a number of ways.<\/p>\n

Discussing its preliminary concerns, the EU said it found Amazon\u2019s marketplace to be a \u201cparticularly important channel\u201d to sell RVCs in several EU Member States and it\u2019s concerned the tech giant could have the ability and incentive to foreclose iRobot\u2019s rivals by preventing them from selling competing robot vacs on its marketplace or else downgrade their access via strategies such as self-preferencing iRobot kit in ad listings and blocking rivals from accessing certain ad services \u2014 with the net effect of raising costs for rivals to advertise and sell on its marketplace.<\/p>\n

\u201cSuch foreclosure strategies could restrict competition in the market for the manufacturing and supply of RVCs, leading to higher prices, lower quality, and less innovation for consumers,\u201d the Commission said.<\/p>\n

It\u2019s also worried Amazon could seek to shutter or downgrade rivals\u2019 access to APIs for its AI assistant software Alexa.<\/p>\n

\u201cInteroperability with the Alexa software and access to the WWA [\u2018Works With Alexa\u2019] certification appear to be important selling points for RVC manufacturers and suppliers to compete,\u201d it noted.<\/p>\n

Additionally, the Commission is concerned over the data advantage Amazon would gain from owning iRobot.<\/p>\n

\u201cAmazon would obtain access to iRobot\u2019s users\u2019 data, including: (i) information provided by iRobot\u2019s RVCs users; (ii) information collected by iRobot\u2019s RVCs; and (iii) information collected by iRobot from third parties. This data\u00a0may provide Amazon with an\u00a0important advantage in the market for online marketplace services to third-party sellers (and related advertising services) and\/or other data-related markets,\u201d it suggests.<\/p>\n

\u201cFor example, iRobot\u2019s data may allow Amazon to better rank organic results and advertisements on its own marketplace and\/or to better personalize and target the advertisements, making it more difficult for rival marketplace providers to match Amazon\u2019s online marketplace services. Thus, the transaction may raise barriers to entry and expansion for Amazon\u2019s competitors to the detriment of consumers.\u201d<\/p>\n

In a statement, the bloc\u2019s competition chief, Margrethe Vestager, said:<\/p>\n

\n

Amazon is both an online marketplace and a retailer. We are concerned that, by acquiring iRobot, Amazon may use such dual role to foreclose access by iRobot\u2019s rivals to its marketplace. With our in-depth investigation, we will also investigate whether Amazon would use data collected by iRobot to strengthen its position as online marketplace provider. We want to ensure that the acquisition of iRobot by Amazon does not have a negative impact on businesses and consumers, by distorting competition on the relevant markets.<\/p>\n<\/blockquote>\n

The EU will now conduct an in-depth investigation of the proposed acquisition to test whether its preliminary concerns are merited.<\/p>\n

Regulators have until November 15 to take a decision on clearance.<\/p>\n

If competition concerns remain the Commission is likely to seek behavioral remedies from Amazon rather than seeking an outright block on the deal. The bloc has a history of greenlighting tech M&A, even when concerns are high, such as Google\u2019s controversial purchase of Fitbit \u2014 which the EU cleared at the end of 2020<\/a> after accepting commitments in relation to the Fitbit API and a pledge from Google not to use Fitbit users\u2019 health data for advertising for ten years.<\/p>\n

Google has since said it will be mandatory for Fitbit users to migrate to Google accounts by 2025<\/a>, deprecating the option to log in with a separate Fitbit account. The tech giant has also degraded the experience for Fitbit users, as TechRadar<\/a> reported earlier this year, including by removing the ability to download music files onto Fitbit smartwatches. It also removed access to certain music apps \u2014 widening the feature set gap between its own Pixel line of smartwatches (which have more ways to play music) over Fitbit branded watches it now also owns.<\/p>\n

The Commission\u2019s reluctance to block tech M&A extends even to situation when other regulators are inclined to deny deals. Such as, in a recent, high profile example, the Microsoft Activision acquisition \u2014 which was cleared by the EU in May<\/a> but blocked by the U.K. in April<\/a>.<\/p>\n

Over in the U.S., the FTC is also reportedly<\/a> seeking an injunction against the transaction. But the EU waived the $68.7 billion deal through after accepting remedies from Microsoft such as a promise not to prevent regional consumers from streaming all current and future Activision games via rival cloud gaming services for the next 10 years.<\/p>\n

Amazon was contacted for comment on the EU probe. A company spokesperson sent us this statement:<\/p>\n

\n

We continue to work through the process with the European Commission and are focused on addressing its questions and any identified concerns at this stage. iRobot, which faces intense competition from other vacuum cleaner suppliers, offers practical and inventive products. We believe Amazon can offer a company like iRobot the resources to accelerate innovation and invest in critical features while lowering prices for consumers.<\/p>\n<\/blockquote><\/div>\n

<\/br><\/br><\/br><\/p>\n

Science, Tech, Technology<\/br>
\n<\/br>
\nSource:https:\/\/techcrunch.com\/2023\/07\/07\/amazon-irobot-eu-antitrust-probe\/<\/a><\/br><\/br><\/p>\n","protected":false},"excerpt":{"rendered":"

Source:https:\/\/techcrunch.com\/2023\/07\/07\/amazon-irobot-eu-antitrust-probe\/ EU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition 2023-07-09 22:16:29 Amazon\u2019s planned acquisition of iRobot is now under in-depth antitrust scrutiny in the European Union. The $1.7 billion deal for the ecommerce behemoth to pick up the robot vacuum maker, announced just under a year ago, was cleared by competition regulators […]<\/p>\n","protected":false},"author":1,"featured_media":36780,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"nf_dc_page":"","om_disable_all_campaigns":false,"pagelayer_contact_templates":[],"_pagelayer_content":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[26,17,8],"tags":[],"class_list":["post-36779","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-science","category-tech","category-technology"],"yoast_head":"\nEU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition - Science and Nerds<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/scienceandnerds.com\/2023\/07\/09\/eus-competition-unit-takes-a-deeper-look-at-amazons-irobot-acquisition\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"EU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition - Science and Nerds\" \/>\n<meta property=\"og:description\" content=\"Source:https:\/\/techcrunch.com\/2023\/07\/07\/amazon-irobot-eu-antitrust-probe\/ EU\u2019s competition unit takes a deeper look at Amazon\u2019s iRobot acquisition 2023-07-09 22:16:29 Amazon\u2019s planned acquisition of iRobot is now under in-depth antitrust scrutiny in the European Union. 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